Growth Hacking: How can it help your startup?

What is growth hacking?

If you’re an entrepreneur, you’ve probably heard of the phrase ‘growth hacking’ before, but what does it mean?

It was first coined by serial entrepreneur, Sean Ellis, back in 2010 when he became frustrated when unable to find a replacement for himself. At that point, he had helped several tech startups achieve incredible growth and IPOs, becoming the person companies approached if they wanted to grow their user base.

However, when Sean looked for other ‘marketing’ people to assist his duties, he was unable to find a proper candidate. He began to realise he shouldn’t be advertising for one with a marketing degree and marketing experience.

A traditional marketer has a very broad focus, with little of their skillset valuable to an early stage startup with little funding or certainty. Startups don’t require a marketer to build and manage a marketing team or launch a television advertising campaign, they require users to adopt their products – growth.

Hence, Sean changed the description of his advertisement from marketer to growth hacker, giving birth to the wildly popular phrase.

A growth hacker does not replace a marketer, they’re just different to a marketer. Their primary concern is GROWTH, where every strategy, tactic and initiative is attempted at growing the users of the startup.

Now what does the ‘hacker’ in the name mean? A growth hacker isn’t the guy who’s always working on illegal endeavours to try break websites. Instead, the hacker is supposed to be clever, experimentative and use whatever they have at their disposal to create a solution that might be overlooked by others. This is often used together with their understanding of technology – software, databases, API’s etc – to try and grow the startup.

So what does growth hacking look like?

Airbnb is perhaps the most famous example of growth hacking. They enable anyone with spare bedrooms or houses to rent out their rooms to other users. Airbnb leveraged Craigslist, a platform with millions of users looking for accommodations, to increase their user base substantially.

Craigslist didn’t have a public API or an easy technological solution for other companies to post their services. Instead, Airbnb cleverly decided to reverse engineer how Craiglist’s forms work, and then make their product compatible.

Looking back and analysing their actions, we begin to see the ingenious actions of Airbnb where they thought outside the box. They did something any traditional marketer would never have ever thought of, much less execute. They didn’t read about someone else using Craigslist to cross promote something, instead they had the guts to try something that had no guarantee would work. Furthermore, their growth mechanism was heavily technology based and the only reason they were able to execute it was because the growth hacker and team had strong technical abilities to complement their creativity.

However, Airbnb was no longer able to steal users after Criaglist fixed the vulnerabilities enabling the growth hack. This illustrates that most growth mechanism have a finite lifespan but this temporary opportunity provided Airbnb with the sufficient critical mass to grow themselves.

Who makes a good growth hacker?

Growth hackers are good analytical people, capable of understanding numbers, able to dissect and measure progress of campaigns. However, at the same time, growth hackers are also experimentative, creative and curious people. They need to be constantly think of new ideas, trying new things and having a curiosity to do things differently.

How can you growth hack?

Neil Patel, an online marketing and growth hacking guru describes the following steps when growth hacking:

Define actionable goals – focus on a narrow and specific goal you need to achieve e.g. increase traffic by 2x.

Implement analytics to track your goals – without proper analytics, all goals are empty. You need definitive numbers to be able to measure progress and make informed decisions in the future.

Leverage your existing strengths – every startup has inherent strengths it can leverage and you must attack growth based on your strengths e.g. large amounts of customer data

Execute the experiment – now it’s time to test your hypothesis. Remember not to get discouraged by the initial results and integrate the learnings from your failures. Remember Thomas Edison’s quote, ‘I have not failed 1000 times. I have successfully discovered 1000 ways to not make a light bulb’.

Optimise the experiment – they are meant to be adjusted and re-run. Make sure to use A/B testing and have a control group at all times.

Repeat – success is a byproduct of perseverance, not luck.

Growth Hacking Strategies

Pull

Pulling people in is the first method of getting visitors to your product and can be done by providing incentives. This tactic revolves around providing value to users as a means of pulling them in. Strategies include:

Hire affiliates to promote your products by providing them an incentive. However, make sure the life time value of each customer outweighs the cost per acquisition

Product

The third method is to use your actual product and get your users to bring their own network of relationships to your product. Even if you are able to make one person who uses your product bring along one other person, you’ve gone viral and growth will never stop (have a think about this). Strategies include:

Network invitations – where users invite their own relationships to use the product. For example, it’s only two clicks on Uber to invite your phonebook connections to the app. Similarly, Facebook and Linkedin also make it incredibly simple to invite your email contacts to join the network.

API integrations – going deeper than social sharing, API integration allows an app to share things without user permissions each time. For example, Spotify heavily utilised Facebook to grow their product where user’s activity were automatically published to their Facebook feed, made possible through an API integration.

Incentives – by providing incentives to users, they are more likely to share the product. Dropbox has been extremely successful in providing 250mb free space to the user for each ‘friend’ they sign up to the program.

Now you probably realise that many startups should consider growth hacking as a means of accelerating growth. So where you do start?

Despite the strategies listed above, growth hacking is not a formula or ‘off the shelf’ strategy that guarantees success. Certain strategies may work exceedingly well for some startups and have absolutely no effect for others.

The only way to find out is by constantly testing new methods through trial and error. So what’s preventing you now from getting started?

Victor Zhang has been actively involved in start-ups and the business community since late primary school. Having started his own businesses and by being involved in a number of various projects, he sees the opportunities that entrepreneurship provides and brings this to students throughout Australia through Generation Entrepreneur. "I want to make a change and take on a challenge, as a social entrepreneur to build a solution to the problems I see around me..."

2 COMMENTS

API integration is one of the sure shot way to growth hacking! We at Dryfta have been doing this from day one by integrating with the APIs of other event management platforms and companies who serve prospects similar to ours. Some of them help your cause by promoting your app in their marketplace.